Tax reform advances in the House and can be voted on until Friday (7)

The president of the Chamber of Deputies, Arthur Lira (PP-AL), promised that this Thursday (6) he will guide the vote on the tax reform project by the plenary of the House. According to him, “if everything goes well”, the proposal will end up being voted on in its entirety, in the first and second rounds, until next Friday (7).

When participating in a meeting at the headquarters of the National Confederation of Municipalities (CNM) last Tuesday (4), the rapporteur for the text, deputy Aguinaldo Ribeiro (PP-PB), announced that he would officially present the proposal only next Friday (7). The movement of the president of the Chamber, advancing the processing of the proposal, is part of a concentrated effort — in partnership with the federal government — in order to fulfill the objective of approving the reform before the parliamentary recess this month.

Aguinaldo Ribeiro has the support of Lira and ministers of the Lula government to try to reduce the resistance of governors and mayors, in relation to the proposed changes. Many mayors fear the loss of revenue for their municipalities.

One of the points still not understood is the definition of the operation of the Federative Council and the Regional Development Fund. Regarding the Council, which will define fiscal and tax policies, the composition will be more detailed, to give parity to the states in relation to the Union.

Also under discussion is a new transition calculation for the Tax on Goods and Services (IBS), which could unify ICMS and ISS.

concerns

At the headquarters of the National Confederation of Municipalities (CNM), last Tuesday (4), the rapporteur Aguinaldo Ribeiro heard complaints from some mayors. They claim that the reform reduces municipal revenues, concentrates tax resources in the Union, violates the federal pact __ and increases taxes in various sectors of the economy.

One of the main concerns of municipal managers concerns the possibility of raising taxes, mainly in the service sector and agribusiness.

Mayors of 33 Brazilian cities, 15 of which are state capitals, and governors of eight states (mainly in the South and Southeast) are taking part in meetings in Brasília this week with the aim of discussing tax reform.

revenue loss

The possibility of revenue loss for municipalities is one of the main concerns of many municipal managers. This is the case of the mayor of the mining town of Ipatinga, Gustavo Nunes (PL-MG). “It’s unfortunate that there’s still room for this kind of talk today in Brazil,” he complained. “The proposal is in fact to withdraw resources from the municipalities, which they need so much, to fill the federal government’s coffers even more, to put the municipalities inside the halter, let’s say the federal government, to come knocking on the door and begging for money for the municipalities”, he protested.

The mayor of Ipatinga also said that he was “disturbed” after participating, recently, in a meeting with the Minister of Finance, Fernando Haddad: “On another occasion we also had a conversation here in Brasilia promoted by the CNM itself, where they were invited the mayors of cities with more than 100 thousand inhabitants. And we came out of that conversation with Minister Fernando Haddad upset, let’s put it that way”, he pointed out.

“The minister spoke and spoke and said nothing; he did not explain where this replenishment of resources for the municipalities would come from” — he complained, clarifying that “the municipality of Ipatinga may suffer a negative impact of around R$ 150 million. He stated that where the government should enter to allocate more resources to municipalities, the federal government is going against the grain. It would be precisely withdrawing resources to place the municipalities under the federal government’s basket — and that is unacceptable”, criticized Gustavo Nunes.